After moving on from flat tax, Kansas House finds unanimous support for a new tax cut plan

Kansas lawmakers have crafted a new bipartisan tax plan that could provide relief on income, property and sales taxes.

After House Republican leadership moved on from the divisive flat tax proposal, the House unanimously passed a new tax cut package Wednesday morning. That came after taking up its tax plan in Senate Bill 300 Tuesday evening, debating and making amendments until about 10 p.m.

"This is a true compromise tax relief plan with real bipartisan support," House Speaker Dan Hawkins, R-Wichita, said in a statement. "The Governor should sign this bill because it delivers the broad-based property, income, and Social Security tax relief that Kansans want and need while upgrading to a more regionally competitive tax structure."

While Democratic Gov. Laura Kelly has indicated at least some openness to the bill, it remains to be seen whether it will reach her desk.

It first would have to get approval from the Senate, where Republican leadership hasn't moved on from the flat tax since the Legislature's failure to override Kelly's veto of House Bill 2284. The Senate earlier this month passed Senate Bill 539, which takes a phased approached to imposing a flat tax.

House speaker said chamber couldn't override veto on flat tax

Hawkins told reporters last week that House GOP leadership moved on from the flat tax because it became clear they wouldn't have the votes to override a veto. So their new plan would go from the current three income tax brackets to two.

The flat tax was criticized by Democrats and a handful of Republicans for providing little benefit for the middle class while mostly benefitting the poorest and richest Kansans.

"I know with what we listened to in opposition to the single rate, we weren't doing enough for that middle," said Rep. Adam Smith, R-Weskan, explaining that adopting a two tax brackets instead of a single rate is better for those in the middle.

Kelly told reporters last week that it is her preference to stick with the current three brackets.

"It's progress; it gives us something to talk about," she said of the new House plan. "I can't tell you that the actual bill is acceptable, but I do see it as an opportunity to engage in conversation with the Legislature to come up with something that works for all of us."

Since her comments, some of the details of the package have changed as the House adopted and rejected a slew of amendments by Democrats and Republicans.

Many amendments to new tax plan rejected

Smith discouraged certain proposed additions, likening it to trying to grab too many cookies at once from a cookie jar.

He said the target was a tax package totaling no more than $500 million a year, as House budgeters view that as sustainable. An updated fiscal note on the amended version of the plan wasn't immediately available.

Among other pieces in the tax package are increasing the standard deduction, elimination of state income taxes on Social Security, cutting taxes on banks, increasing the residential exemption on a state property tax, decreasing the mill levy of a state property tax and accelerating elimination of the food sales tax.

But the details of the House tax plan are expected to further change in conference committee negotiations with the Senate — which could risk losing the support of House Democrats.

House Minority Leader Vic Miller, D-Topeka, urged the House not to let that happen.

"Do not let the other side mess with this package," Miller said. "I think this may be what people out across the state have been looking for. Hang tight if this goes to conference."

He voted for the bill "because there's a lot of good things in it," despite failing to convince his colleagues to remove the abolition of a program used for local property tax relief.

"I don't know if you all are having the same feeling I am, but I got to tell you I am really proud of the House of Representatives and what we did yesterday," Hawkins said during the vote. "Really amazing what happens when everybody works together. I don't have any other words to say except thank you. You guys are awesome."

Jason Alatidd is a Statehouse reporter for the Topeka Capital-Journal. He can be reached by email at jalatidd@gannett.com. Follow him on X @Jason_Alatidd.

This article originally appeared on Topeka Capital-Journal: Kansas Republicans, Democrats back new tax cut plan with no flat tax